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FTC Bureau of Consumer Protection, Using Artificial Intelligence and Algorithms (Apr. 8, 2020) (full-text).


Headlines tout rapid improvements in artificial intelligence technology. The use of AI technology — machines and algorithms — to make predictions, recommendations, or decisions has enormous potential to improve welfare and productivity. But it also presents risks, such as the potential for unfair or discriminatory outcomes or the perpetuation of existing socioeconomic disparities. Health AI offers a prime example of this tension. Research recently published in Science revealed that an algorithm used with good intentions &mash; to target medical interventions to the sickest patients — ended up funneling resources to a healthier, white population, to the detriment of sicker, black patients.

The FTC's law enforcement actions, studies, and guidance emphasize that the use of AI tools should be transparent, explainable, fair, and empirically sound, while fostering accountability. The FTC believes that its experience, as well as existing laws, can offer important lessons about how companies can manage the consumer protection risks of AI and algorithms.